Business Directories

Lebanon targets gas tenders in 3 months

Beirut, January 5, 2012

Lebanon will issue international tenders for drilling in its potentially gas-rich Mediterranean waters and aims to have contracts signed with the winning firms within a year, its Minister of Energy said on Thursday.

Interest in drilling off Mediterranean coasts has grown since two natural gas fields were discovered off the coast of Israel, Lebanon's southern neighbour. Estimates value those reserves at tens of billions of dollars.

Lebanon has yet to explore off its own coast but on Wednesday its cabinet approved plans to implement a law on drilling that would pave the way for international tenders.

"Launching the international tenders can and should be completed in the next three months and we will make a big effort to do this," Gibran Basil told Reuters by telephone. "The last step will be signing the first contract which we will do in the next year or less."

Basil said the cabinet's approval of the ministry's plans would allow it to appoint a committee to oversee drilling and exploration. The committee should be appointed within a month, he said.

The minister shrugged off concerns over potential drilling delays due to a maritime border conflict with Israel.

The two countries, which remain formally at war, are disputing an 850 sq km stretch of sea off their coast that lies near an area where US and Israeli firms discovered the two massive natural gas fields.

"Our petroleum resources are not limited to this area and this issue will not stop us in any way from progressing on the drilling issue," the energy minister said.

"If Israel thinks it can delay us with this plan, no, that is a completely separate problem and we are not cornered."

United Nations officials said the two countries were working to avoid conflict. But Lebanon's powerful Hezbollah, a Shi'ite Muslim political party and militant group that fought a war with Israel in 2006, have warned they will defend the country's natural resources.

Basil said American, European, Asian and African firms had all signalled interest in drilling off Lebanese shores.

"All the big international companies have not only shown an interest but have participated in conferences that we held and bought the information we have," he said. "Their involvement hasn't stopped just at words, they have begun to pay money." – Reuters